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Christopher Hutton, Technology Reporter


NextImg:DOJ sues Call of Duty developer over esports salary limits

The Department of Justice filed an antitrust suit against one of the largest game developers over its taxing esports team salaries and suppressing competition between teams.

Activision Blizzard, the developer of Call of Duty, Overwatch, and Starcraft II, was sued on Tuesday by the DOJ. The agency alleged that the company had violated the Sherman Antitrust Act, which bans anticompetitive actions by companies to fix wages. The company is separately under scrutiny by the Federal Trade Commission, which moved to block Microsoft from acquiring it.

"Video games and esports are among the most popular and fastest growing forms of entertainment in the world today, and professional esports players — like all workers — deserve the benefits of competition for their services. Activision's conduct prevented that from happening," DOJ Assistant Attorney General Jonathan Kanter said in a statement. "Today's lawsuit makes clear that the Antitrust Division remains committed to protecting workers across all types of industries from anticompetitive conduct."

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Activision implemented a "Competitive Balance Tax" that "effectively operated as a salary cap, penalized teams for paying esports players above a certain threshold, and limited player compensation in these leagues," the filing said. If the court approves the DOJ suit against Activision Blizzard, the gaming company must end all salary caps in its leagues and update its antitrust policies accordingly.

Overwatch esports teams have been pushing Activision Blizzard to provide more wages. Several teams have kept the United Kingdom-based law firm Sheridans on call to negotiate for an economic relief package, according to Sports Business Journal. The teams have regularly been losing money, and the fees have likely accentuated this problem.

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Microsoft has been attempting to purchase Activision Blizzard since last year. The FTC filed to block the $68.7 billion acquisition in December but has run into trouble with other attempts to stop acquisitions.